Chapter 25 Measuing the Aggregate Economy

Chapter 25 Measuing the Aggregate Economy - Chapter 25:...

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Chapter 25: Measuring the Aggregate Economy GDP is the total market value of all final goods and services produced in an economy in a one year period. Four factors of GDP: o Consumption is spending by households on good and services. o Investment is spending for the purpose of addition production. o Government spending is goods and services that government buys These DO NOT INCLUDE transfer payments – payments to individuals to do not involve production by the individuals (no production associated). o Net Exports – spending on goods and services produced in the US that foreigners buy (exports) minus goods and services produced abroad that US citizens purchase (imports). GDP represents a flow –an amount per year not an amount at a particular time GDP refers to the market value of final output A wealth account is a balance sheet of an economy’s stocks of assets and liabilities. Real wealth is the value of the productive capacity of the assets of an economy measured by the goods and services it can produce now and in the future.
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This note was uploaded on 02/23/2011 for the course ECON 2020 taught by Professor Coppock during the Spring '08 term at UVA.

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Chapter 25 Measuing the Aggregate Economy - Chapter 25:...

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